Water and socioeconomic dependencies: a multiregional model

Abstract

River basins often extend over several regions connected by both water flows and socioeconomic factors. Therefore, water policy and diverse hydrological scenarios can affect socioeconomic variables in other parts of a river basin. This paper proposes a tool combining hydro-economic and input–output models to analyze the socioeconomic impacts of different hydrologic scenarios from a multiregional standpoint. To this end, we have built a monthly-basis hydro-economic model to fit a multiregional input–output table to estimate direct and indirect impacts on value added and employment, bringing together data on water flow and regional demand, sector-based economic analysis and macroeconomic impacts. In a given hydrological scenario, the hydro-economic model determines the output of irrigated farmland in each region and the value added generated by each crop. These data are then processed using the multiregional input–output model to determine socio-economic impacts in each of the regions forming the river basin. This methodology allows evaluation of different water policies, providing a tool for policymakers to estimate socio-economic impacts. Finally, we apply this methodology in two scenarios reflecting the opportunity costs of diverse hydrological scenarios in terms of value added and employment terms to demonstrate its excellent analytic capacity.